State Consumer Disputes Redressal Commission
Punjab Urban Planning And Development ... vs Angrej Kaur on 31 July, 2024
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
PUNJAB, CHANDIGARH.
1) First Appeal No.240 of 2023
Date of institution : 31.03.2023
Reserved On : 17.07.2024
Date of decision : 31.07.2024
Punjab Urban Planning and Development Authority, Bhagu Road,
Bathinda, through its Estate Officer.
....Appellant/Opposite Party
Versus
Angrej Kaur, aged about 58 years, wife of Jaswant Singh, R/o House
No.9, Park Avenue, Faridkot.
....Respondent/Complainant
2) First Appeal No.802 of 2022
Date of institution : 19.09.2022
Reserved On : 17.07.2024
Date of decision : 31.07.2024
Angrej Kaur, aged about 60 years, wife of Jaswant Singh, R/o Park
Avenue, Tehsil and District Faridkot.
....Appellant/Complainant
Versus
Punjab Urban Planning and Development Authority, Bhagu Road,
Bathinda, through its Estate Officer.
....Respondent/OP
First Appeals under Section 41 of the
Consumer Protection Act, 2019 against the
order dated 03.12.2021 passed by the
District Consumer Disputes Redressal
Commission, Faridkot.
First Appeal No.240 of 2023 2
Quorum:-
Hon'ble Mrs. Justice Daya Chaudhary, President
Ms. Simarjot Kaur, Member
1) Whether Reporters of the Newspapers may be allowed to see the Judgment? Yes/No
2) To be referred to the Reporters or not? Yes/No
3) Whether judgment should be reported in the Digest? Yes/No Present (FA No.240 of 2023):-
For the Appellant : Sh. Ashish Grover, Advocate For the Respondent : Mr. Nishant Sindhu, Advocate for Mr. Ashutosh Saklani, Advocate.
JUSTICE DAYA CHAUDHARY, PRESIDENT This order of ours shall dispose off total five Appeals i.e. First Appeal No.240 of 2023 & First Appeal No.802 of 2022 (Cross Appeals), First Appeal No.241 of 2023, First Appeal No.1035 of 2022 and First Appeal No.1074 of 2022, as similar questions of law and facts are involved therein. However, the facts are being extracted from First Appeal No.240 of 2023.
First Appeal No.240 of 2023
2. Appellant/OP i.e. Punjab Urban Planning and Development Authority has filed the present Appeal under Section 41 of the Consumer Protection Act, 2019 against the order dated 03.12.2021 passed by the District Consumer Disputes Redressal Commission, Faridkot (in short, "the District Commission"), whereby the Complaint filed by the Respondent/Complainant was allowed. First Appeal No.240 of 2023 3
3. It would be apposite to mention here that hereinafter the parties will be referred, as had been arrayed before the District Commission.
4. Briefly, the facts of the case as made out by the Respondent/Complainant in the Complaint filed by her before the District Commission are that one Pawan Kumar was allotted plot No.77 in the project launched by the OP namely PUDA Enclave, Faridkot in the year 2012 at the rate of ₹5,000/- per sq.yd. He had paid the price of the plot along with interest and other charges to the OP. The Complainant had purchased the said plot from the original allottee in the month of January, 2019 by paying an amount of ₹12,15,610/- and thereafter the said plot was transferred in her name. As on 13.12.2018, an amount of ₹12,15,610/- was paid to the OPs towards the price of the said plot. As per the terms and conditions of the allotment letter, the OP was required to provide all the amenities such as water supply, sewerage connections, roads, street lights etc. and to hand over the possession within a period of 18 months from the date of allotment but they had failed to complete the development at the site. Only a boundary wall was constructed, which was broken at various places. The Complainant as well as the original allottee had been approaching the OP for doing the needful but to no effect.
5. The Complaint was filed with the prayer for issuance of directions to the OP to complete the development works in the said First Appeal No.240 of 2023 4 project and to refund the interest so charged by it on the amount so deposited by the Complainant along with interest at the rate of 12% per annum and also to pay compensation of ₹5 lac for causing mental agony and harassment to the Complainant and ₹20,000/- towards litigation expenses.
6. Upon issuance of notice in the said Complaint, the OP had appeared through Counsel and filed written version, wherein certain preliminary objections were raised that as per the terms and conditions of the allotment letter, any dispute or reference was required to be referred to the Sole Arbitrator i.e. Chief Administrator, PUDA. No cause of action had arisen to the Complainant to file the Complaint. The Complaint was time barred. Other averments as made in the Complaint were denied and it was prayed that the Complaint be dismissed.
7. By considering the contents of the Complaint and reply thereof filed by the OP, the Complaint was allowed by the District Commission vide order dated 03.12.2021. The relevant portion of said order as mentioned in Para-11 is reproduced as under:
"11 It is observed that there is no dispute regarding allotment of plot in question and even there is no denial of the fact that Complainant has deposited entire sale consideration towards the costs of plot to OP, but OP have been deficient in fulfilling their promise of completion of development work. Moreover, OP have not produced on record any document or letter from concerned departments showing provision of basic amenities at site in question. On the contrary, Complainant has produced sufficient and cogent evidence to prove his pleadings, authenticity of which cannot be ignored. There is deficiency in service on the part of OP in not carrying out the development work in time and due to lack of basic First Appeal No.240 of 2023 5 amenities, Complainant has been deprived of constructing the said plot. OP retained the price of plot but as per agreement, failed to carry out development work at the site within prescribed time frame, therefore, OP is liable to pay interest on amount deposited by Complainant. Hence, Complaint in hand is hereby allowed. Opposite Party is directed to pay the interest on amount of Rs.12,16,500/- to Complainant at the rate of 4% per anum from date of lapse of period prescribed for development of site as per letter of intent till the date of realization of the amount. Opposite Party is further directed to pay Rs.5,000/- to Complainant as compensation for harassment and mental agony suffered by him besides Rs.5,000/- as litigation expenses. Compliance of this order be made within one month from the date of receipt of copy of this order. Copy of the order be supplied to parties free of cost as per law. File be consigned to the record room."
8. Being aggrieved by the said order dated 03.12.2021 passed by the District Commission, the Appellant/OP has filed First Appeal No.240 of 2023 for setting aside of said order, whereas the Respondent/Complainant has filed First Appeal No.802 of 2022 for modification of the impugned order by enhancing the compensation as awarded by the District Commission by raising a number of arguments.
Misc Application No.464 of 2023 (Delay)
9. There is delay of 437 days in filing of First Appeal No.240 of 2023. MA No.464 of 2023 has been filed for condonation of delay, which is supported by an affidavit.
10. For the reasons recorded in the Application, the same is allowed and the delay in filing of the Appeal is condoned subject to costs of ₹15,000/- to be deposited in the Consumer Legal Aid Account of this Commission.
Misc Application No.1382 of 2022 (Delay) First Appeal No.240 of 2023 6
11. Similarly, there is delay of 220 days in filing of First Appeal No.802 of 2022. MA No.1382 of 2022 has been filed for condonation of delay, which is supported by an affidavit.
12. For the reasons recorded in the Application, the Application is allowed and the delay in filing of the Appeal is condoned subject to costs of ₹10,000/- to be deposited in the Consumer Legal Aid Account of this Commission within a period of 2 weeks from the date of receipt of copy of the order, failing which the Appeal shall stand dismissed on the ground of limitation.
13. Mr. Ashish Grover, learned Counsel for the Appellant/OP has submitted that all the developments works had already been completed at the site and thereafter the public notices were got published in the newspaper 'Ajit' on 11.12.2014 and 29.11.2017 informing the allottees that the development works had been completed and they could take the possession of their respective plots within a period of 10 days, failing which it was to be presumed that the possession had been delivered. However, the Complainant had never approached the OP for taking the possession. Learned Counsel has further submitted that the Complainant has prayed for grant of interest on the amount so deposited by her on account of delay in delivery of possession. However, in certain cases decided by the Hon'ble National Commission, the rate of interest was reduced from 9% to 6%. Learned Counsel has further submitted that the First Appeal No.240 of 2023 7 Complainant is the subsequent allottee and as such she is entitled to the interest from the date of transfer of the plot in her favour and not from the date of deposit. Learned Counsel has also relied upon the following judgments in support of his contentions:
i) M/s Laureate Buildwell Pvt. Ltd. v. Charanjit Singh Civil Appeal No.7042 of 2019 decided on 22.07.2021;
ii) DLF Homes Panchkula v. D.S. Dhanda etc. Civil Appeal No.4910-4941 of 2019 decided on 10.05.2019 (SC);
iii) HUDA v. Raje Ram (2008) 17 SCC 407(SC);
iv) FA No.731 of 2021 (PUDA v. S. Yadwinder Singh) decided on 29.07.2022; and
v) FA No.1703 of 2019 (Chief Administrator, PUDA v. Manju Chuhan) decided on 12.02.2020.
14. Mr. Nishant Sindhu, proxy for Mr. Ashutosh Saklani, learned Counsel for the Respondent/Complainant (Appellant in FA No.802 of 2022) has submitted that the Complainant had already paid the entire sale price of the plot. The possession of the plot was to be delivered within a period of 18 months from the date of issuance of the allotment letter after completion of the development works but the OP had failed to do so. Learned Counsel has further submitted that only a boundary was constructed at the site but that too was lying broken and the project had been abandoned by the OP. Even no basic amenities were provided at the site. At the end, learned Counsel has submitted that the District Commission has awarded interest only at the rate of 4%, whereas in First Appeal No.410 of 2021 (Punjab First Appeal No.240 of 2023 8 Urban Planning and Development Authority v. Ajaib Singh) decided by this Commission on 13.07.2022 along with bunch of other cases, the interest at the rate of 9% per annum had been awarded. Therefore, the Appeal filed by the OP is liable to be dismissed but the impugned order passed by the District Commission is liable to be modified.
15. We have heard the oral arguments raised by learned Counsel for the parties. We have also carefully perused the impugned order passed by the District Commission and all other relevant documents available on the file.
16. Facts regarding filing of the Complaint by the Complainant before the District Commission, reply thereto filed by the OP, allowing of said Complaint and thereafter filing of the present Appeals by both the parties before this Commission are not in dispute.
17. The Appellant/OP has raised an objection in its reply that the Complainant was not falling under the definition of 'consumer' as she had purchased the plot for earning profits. The Hon'ble National Commission has also held in Meghna Singh Khera and Ors. v. Unitech Ltd., 1 (2020) CPJ 93 (NC) as under:-
"....
15. Another contention of the Opposite Party was that the purchase of the residential Unit was for commercial purpose and the Complainants were not consumers within the meaning of Section 2(1)(d) of the Consumer Protection Act, 1986. The expression commercial purpose used in Section 2(1)(d) of the Act came up for consideration of this Commission in Kavita Ahuja Vs. Shipra Estates Ltd., CC 137 of 2010 decided on 12-02-2015 and the following view was taken:First Appeal No.240 of 2023 9
"The expression 'commercial purpose' has not been defined in the Act and therefore, as held herein below by the Hon'ble Supreme Court in Laxmi Engineering Works Vs. P.S.G. Industrial Institute (1995) 3 SCC 583, we have to go by the dictionary meanings, "In the absence of a definition, we have to go by its ordinary meaning 'Commercial' denotes "pertaining to commerce"
(Chamber's Twentieth Century Dictionary); it means "connected with, or engaged in commerce; mercantile, having profit as the main aim" (Collins English Dictionary) whereas the word 'commerce' means "financial transactions especially buying and selling of merchandise on a large scale" (Concise Oxford Dictionary)".
6. Going by the Dictionary meaning of the expression 'Commerce' as far as hiring or availing services are concerned, a person can be said to have hired or availed services only if they are connected or related to the business or commerce in which he is engaged. In other words, the services in order to exclude the hirer from the ambit of Section 2(1)(d) of the Act should be availed for the purpose of promoting, advancing or augmenting an activity, the primary aim of which is to earn profit with use of the said services. It would ordinarily include activities such as manufacturing, trading or rendering services. In the case of the purchase of houses which the service provider undertakes to construct for the purchaser, the purchase can be said to be for a commercial purpose only where it is shown that the purchaser is engaged in the business of purchasing and selling houses and / or plots on a regular basis, solely with a view to make profit by sale of such houses. If however, a house to be constructed by the service provider is purchased by him purely as an investment and he is not undertaking the trading of houses on a regular basis and in the normal course of the business profession or services in which he is engaged, it would be difficult to say that he had purchased houses for a commercial purpose. A person having surplus funds available with him would not like to keep such funds idle and would seek to invest them in such a manner that he gets maximum returns on his investment. He may invest such funds in a Bank Deposits, Shares, Mutual Funds and Bonds or Debentures etc. Likewise, he may also invest his surplus funds in purchase of one or more houses, which is/are proposed to be constructed by the service provider, in the hope that he would get better return on his investment by selling the said house(s) on a future date when the market value of such house (s) is higher than the price paid or agreed to be paid by him. That by itself would not mean that he was engaged in the commerce or business of purchasing and selling the house (s).
7. Generating profit by way of trading, in my view is altogether different from earning capital gains on account of appreciation First Appeal No.240 of 2023 10 in the market value of the property unless it is shown that the person acquiring the property was engaged in such acquisition on a regular basis and it was by way of a business activity."
16. The Complainants are senior citizens. Complainant No.1 is a retired Professor and Complainant No.2 is a homemaker. No evidence, whatsoever has been adduced to show that they are involved in any commercial activity. There is no merit in the contention of the Opposite Party that they are not consumers as per the Consumer Protection Act, 1986. It is just another routine, technical objection raised in the reply."
18. In the present case also, the OP has not produced any evidence to prove that the Complainant is indulging in any commercial activity. Therefore, the Complainant falls under the definition of "Consumer", as defined under the Act, as she had hired the "service" of the OP under section 2(42) of the Act.
19. It is also relevant to mention that neither the development works have been completed nor the amount deposited by the Complainant has been refunded till date. Hon'ble National Commission in "Navin Sharma (Dr.) & others v. Unitech Reliable Projects Pvt. Ltd. & Anr." 2016(2) CLT 457 has held that unless or until the Complainants get possession of the Flats, complete in all respects, it is a case of continuous cause of action. In Para-8 of the said judgment, it has been observed as under:-
"8. The first submission made by the Counsel for the opposite party was that the case is barred by time. This argument was raised merely for the sake of cavil. It is now well settled that unless or until the Complainants get the possession of the Flats, they have got continuous cause of action. This view finds support from this authority reported in "Raghava Estates Ltd. v. Vishnupuram Colony Welfare Association" Special Leave to Appeal (Civil) No.35805 of 2012, decided on 07.12.2012."First Appeal No.240 of 2023 11
20. In another case Satish Kumar Pandey & Anr. v. M/s Unitech Ltd. 2015 (3) CPJ 440 (NC), the Hon'ble National Commission held in Para-17 as follows:
"17. It was next contended by the learned Counsel for the Respondent that since the last date stipulated in the buyers agreement for giving possession of the Flat to them expired more than two years ago, the Complaint is barred by limitation prescribed in Section 24A of the Consumer Protection Act. It is now settled legal proposition that failure to deliver possession being a continuous wrong it constitutes a recurrent cause of action and, therefore, so long as the possession is not delivered to him the buyers can always approach a Consumer Forum. It is only when the seller Flatly refuses to give possession that the period of limitation prescribed in Section 24A of the Consumer Protection Act would begin to run. In that case, the Complaint has to be filed within two years from the date on which the seller refuses to deliver possession of the Flats to the Complainants at any point of time and, therefore, the cause of action continues to subsist in favour of the Complainants. Reliance in this regard may be placed upon the decision of the Hon'ble Supreme Court in Meerut Development Authority v. M.K. Gupta IV (2012) CPJ 12, where the Hon'ble Supreme Court held that in such a case the buyer has a recurrent cause for filing a Complaint for non-
delivery of possession of the plot."
21. In view of the law as laid down in the aforesaid judgments, since neither the development works were completed by the OP at the site nor the amount has been refunded, so it is a case of continuous cause of action and the Complaint is within limitation.
22. Another objection was raised by the Appellant/OP in its reply that as per Arbitration Clause in the allotment letter, the matter between the parties is liable to be resolved only through arbitration. It is relevant to mention here that the Larger Bench of the Hon'ble National Commission vide order dated 13.07.2017 passed in Consumer Complaint No.701 of 2015 titled as Aftab Singh v. EMAAR MGF Land Limited & Anr., has held that an Arbitration Clause in the First Appeal No.240 of 2023 12 afore-stated kind of Agreements between the Complainant(s) and the Builder cannot circumscribe the jurisdiction of a Consumer Fora/Commission notwithstanding the amendments made to Section 8 of the Arbitration Act, 1996. The Civil Appeal No.(s) 23512-23513 of 2017 (M/s EMAAR MGF Land Limited & Anr. Vs. Aftab Singh) filed against the said order of the Hon'ble National Commission has also been dismissed by the Apex Court, vide order dated 13.02.2018. Even the Review Petition (C) Nos. 2629-2630 of 2018 in Civil Appeal Nos. 23512-23513 of 2017 filed against the above said order dated 13.02.2018 has also been dismissed by the Hon'ble Supreme Court, vide order dated 10.12.2018. Therefore, the existence of an Arbitration Clause in the allotment letter is not a bar to resolve the dispute involved in this case by the Consumer Commission.
23. Further the objection raised by the OP is that as per Sections 45 and 174 of the Punjab Regional and Town Planning & Development Act, 1995, the District Commission was not having the jurisdiction to entertain and decide the Complaint. It is relevant to mention that as per Section 3 of the Consumer Protection Act, 1986 (now Section 100 of the Consumer Protection Act, 2019), the provisions of the Act are in addition to and not in derogation of the provisions of any other law for the time being in force. Therefore, the District Commission had the jurisdiction to entertain and try such like cases.
First Appeal No.240 of 2023 13
24. So far as the merits of the case, the same are squarely covered by our earlier verdict/order dated 13.07.2022 passed in the case of Ajaib Singh (supra). So, we proceed to decide the present case in view of the findings given by this Commission in the said case.
25. Admittedly one Mr. Pawan Kumar was allotted plot No.77 in the aforesaid Scheme launched by the OP in the year 2012. He had paid the entire price of the plot along with interest and other charges to the OP. The Complainant had purchased the said plot from the original allottee in the month of January, 2019 by paying an amount of ₹12,15,610/- and thereafter the said plot was transferred in her name. As on 13.12.2018, an amount of ₹12,15,610/- was paid to the OPs towards the price of the said plot. As per Clause-10 of the allotment letter, the OP was required to deliver the possession within a period of 18 months from the date of allotment but it had failed to complete the development at the site as well as to deliver the possession to the Complainant.
26. The plea of the OP is that the public notices were got published in the newspaper 'Ajit' on 11.12.2014 and 29.11.2017 informing the allottees that the development works had been completed and they could take the possession of their respective plots within a period of 10 days, failing which it was to be presumed that the possession had been delivered. The Complainant never approached the OP for taking the possession. However, it is relevant to mention First Appeal No.240 of 2023 14 that no individual notice was issued to the Complainant to take the possession. Public notice is issued only when the whereabouts of a party are not found and simply by issuing the public notices in the newspaper without sending any individual notice to the allottee, it cannot be presumed that the actual and physical possession with complete development of the plot had been delivered to the Complainant.
27. It is also relevant to refer the "Objects and Functions"
given under Section 28 of the Punjab Regional and Town Planning & Development Act, 1995; which are reproduced as under:
28. Objects and Functions of the Authority:-
(1) The objects of the Authority shall be to promote and secure better planning and development of any area of the State and for that purpose the Authority shall have the powers to acquire by way of purchase, transfer, ex-change or gift or to hold, manage, plan, develop and mortgage or otherwise dispose of land or other property or to carry out itself or in collaboration with any other agency or through any other agency on its behalf, building, engineering, mining and other operations to execute work in connection with supply of water, disposal of sewerage, control of pollution and other services and amenities and generally to do anything with the prior approval or on direction of the State Government, for carrying out the purposes of this Act. (2) In particular and without prejudice to the generality of the foregoing provisions, the Authority itself or in collaboration with any other agency or through any other agency on its behalf,-
(i) if so required by the State Government or the Board, take up the works in connection with the preparation and implementation of Regional Plans, Master Plans and New Township Plans and town improvement schemes;
(ii) undertake the work relating to the amenities and services to be provided in the urban areas, urban estates, promotion of urban development as well as construction of houses;
(iii) promote research, development of new techniques of planning, land development and house construction and manufacture of building material;
(iv) promote companies, association and other bodies for carrying out the purposes of the Act ; and
(v) perform any other function which are supplemental, incidental or consequential to any of the functions referred to in this sub-section or which may be prescribed."First Appeal No.240 of 2023 15
28. On perusal of the "Objects and Functions" as reproduced above, it is clear that Punjab Urban Planning and Development Authority (PUDA) has been floating Schemes for setting up developed colonies for general public in various cities in Punjab. Before undertaking such a Scheme, PUDA is required to prepare a proper Scheme, in accordance with the provisions of the Punjab Regional and Town Planning & Development Act, 1995. All the financial implications and other things should have been taken care by PUDA while launching the said scheme. After considering the pros and cons, the Scheme was required to be launched by the development authority being a public authority. By considering/seeing all the terms and conditions of the Scheme, the original allottee had applied for allotment of a plot, which was subsequently purchased by the Complainant. However, the OP had failed to complete the development works within the agreed period and without any sufficient reason. This act of the OP has caused mental agony and harassment to the Complainant.
29. It is also relevant to mention that the Hon'ble Punjab and Haryana High in the case of Ram Kishan & Anr. v. State of Haryana & Ors. CWP No.4108 of 2016 decided on 22.11.2016 had issued strict directions to the States of Punjab and Haryana for launching the Scheme without proper guidelines and for not completing the same as First Appeal No.240 of 2023 16 per the time schedule. The relevant portion of said judgment as mentioned in Para-9 is reproduced as under:
"9. Before parting with the order, it is observed that this court is flooded with huge litigation of such like disputes, where allotments of plots/booth sites, commercial sites, have been made by the respective Governments of the States of Punjab and Haryana, including their Corporations; government undertakings, like HUDA and PUDA, without completing the development works and providing all basic amenities and facilities. Such action of the Government is not only a disadvantage to the Government itself, but also to the public at large, who has to indulge in litigation and spend valuable time of their lives, hard earned money and energy in the courts for years. The time has now come that such type of actions of the Government to allot sites without making the same litigation free and without completing the development works and providing all basic amenities and facilities, have to be curbed down, because such actions lead to multifarious litigation wasting precious time and energy of the court, which can be utilised in disposal of some genuine litigation. Such casual approach of the concerned officers has to be dealt with severely. Therefore, Chief Secretaries of the States of Punjab and Haryana as well as Adviser to Administrator, Union Territory, Chandigarh, are hereby directed to ensure that no government site or site through any government agency shall be offered by way of allotment, auction or otherwise, until and unless the same is completely litigation free, i.e. without any encumbrance etc., and is fully developed, provided with all basic amenities. Moreover, all the allottees have to be treated on parity without any discrimination, because every citizen of this country before Government functionaries is equal before it."
30. In compliance of the aforesaid order passed by the Hon'ble Punjab and Haryana High Court, a meeting was held on 02.01.2017, wherein the Chief Secretary, Government of Punjab; Addl. Chief Secretary, Government of Punjab; Chief Administrator, PUDA, SAS Nagar; Addl. Secretary, Local Govt. Department, Punjab; and General Manager, Estate, Punjab Mandi Board were present. After consideration, the following decisions were taken:
"After consideration, it has been decided to frame policy according to the directions issued by the Punjab and Haryana High Court. As under, following policy will be applicable to all the departments i.e. Local Govt., Punjab Mandi Board, PUDA and all other Special Authorities, PSIEC, Colonization Department and other agencies where the lands are being sold after planning:First Appeal No.240 of 2023 17
1. Chunk Site: Chunk site will be sold on "as is where is" basis". The Authority/Department making this sale will have to ensure that proper connectivity or availability of basic amenities i.e. water supply, sewerage, roads, parking etc. are available. In case such provision has to be made entirely by the purchaser, it must be mentioned specifically at the time of sale.
2. Sale by Auction of Booth, SCO, SCF and other commercial sites, where development is to be done by the auctioning authority:- in such cases the auctioning authority will ensure that no site should be put to auction until and unless all the basic amenities i.e. water supply, sewerage, roads, parking & provision of proper Electronic connection is made available at site.
3. In case the site to be sold through draw of lots of the inviting application from public, the following policy must be followed:-
(i) Application must be invited only when the land is free from all encumbrances.
(ii) After the receipt of application with 10% of the sale price, the draw of lots will be held by the Authority/Deptt. In such cases after payment of 25% of the condition price, the LoI/Allotment letter will be issued to the successful applicant and no interest must be charged till the possession of that plot is given to the Allottee.
(iii) No possession in such cases must be given to allottee until and unless all the basic amenities i.e. water supply, sewerage, Roads, parking etc. wherever required is made.
(vi) The department Authority will duty bound to complete all the development works at site in shortest period possible not extending more than 18 months. In case of 18 months is elapsed and the possession in not handed over to the allottees, simple interest which of 12% will be provided to the allottee on the 25% amount which has been deposited by the Allottee with the Authority/Deptt.
All the conditions will be mentioned in the Brochure. As mentioned above it has been decided that Hon'ble Punjab and Haryana High Court be informed about the above said terms and conditions and further necessary action be taken to notify this policy according to the direction issued by the Punjab and Haryana High Court."
31. From the above, it is apparent that the issue of launching plot/house allotment schemes by the Urban Development Authorities without preparing the proper guidelines and without completing the development activities had already been dealt with by the Hon'ble High First Appeal No.240 of 2023 18 Court and aforesaid decisions were taken to minimize the litigation in such like cases. However, the OP had failed to complete the development and to deliver the possession to the Complainant within the stipulated period and, as such, the 'deficiency in service' on the part of the OP has been clearly proved on record.
32. Since the actual, physical and legal possession of the plot with complete development and infrastructure as well as amenities was not delivered within the stipulated period as per terms and conditions of the allotment letter, so the Complainant is entitled to interest on the amount so deposited by her due to delay in delivery of possession.
33. The District Commission while passing the impugned order had directed the Appellant/OP to pay interest @ 4% on the amount so paid by the Complainant along with compensation of ₹5,000/- and litigation expenses of ₹5,000/-. Learned Counsel for the Appellant/opposite party has relied upon the judgment of the Hon'ble National Commission in the case of Manju Chauhan (supra) and has submitted that the rate of interest in the said case was reduced from 12% to 6%. However, in the other authority as relied upon by learned Counsel for the OP itself in the case of M/s Laureate Buildwell Pvt. Ltd. (supra), the rate of interest i.e. 9% per annum has been held to be justified.
First Appeal No.240 of 2023 19
34. In view of the facts and circumstances, we find that the interest at the rate of 4% as awarded by the District Commission is not sufficient and justified and the Complainant is entitled to interest at the rate of 9% per annum on the amount so deposited by her.
35. In the present case, the Complainant is the subsequent allottee. This Commission had held in the case of Ajaib Singh (supra) in Para-45 & 46 as under:
"45. In some of the Appeals, the Complainants are subsequent allottees. The Hon'ble Supreme Court in the case of M/s Laureate Buildwell Pvt. Ltd. (supra), has held that in case of subsequent allottee/purchaser, the interest on the refundable amount is to be awarded from the date when the builder acquired knowledge of transfer or acknowledged the transfer. Relevant portion of said judgment as mentioned in Paras-31 & 32 is reproduced as under:
"31. In view of these considerations, this court is of the opinion that the per se bar to the relief of interest on refund, enunciated by the decision in Raje Ram (supra) which was applied in Wg. Commander Arifur Rehman (supra) cannot be considered good law. The nature and extent of relief, to which a subsequent purchaser can be entitled to, would be fact dependent. However, it cannot be said that a subsequent purchaser who steps into the shoes of an original allottee of a housing project in which the builder has not honoured its commitment to deliver the flat within a stipulated time, cannot expect any - even reasonable time, for the performance of the builder's obligation. Such a conclusion would be arbitrary, given that there may be a large number- possibly thousands of flat buyers, waiting for their promised flats or residences; they surely would be entitled to all reliefs under the Act. In such case, a purchaser who no doubt enters the picture later surely belongs to the same class. Further, the purchaser agrees to buy the flat with a reasonable expectation that delivery of possession would be in accordance within the bounds of the delayed timeline that he has knowledge of, at the time of purchase of the flat. Therefore, in the event the purchaser claims refund, on an assessment that he too can (like the original allottee) no longer wait, and face intolerable burdens, the equities would have to be moulded. It would no doubt be fair to assume that the purchaser had knowledge of the delay. However, to attribute knowledge that such delay would continue indefinitely, based on an a priori assumption, would not be justified. The equities, in the opinion of this court, can properly be moulded by directing refund of the principal amounts, with interest @ 9% per annum from the date First Appeal No.240 of 2023 20 the builder acquired knowledge of the transfer, or acknowledged it.
32. In the present case, there is material on the record suggestive of the circumstance that even as on the date of presentation of the present Appeal, the occupancy certificate was not forthcoming. In these circumstances, given that the purchaser/Respondent had stepped into the shoes of the original allottee, and intimated Laureate about this fact in April 2016, the interests of justice demand that interest at least from that date should be granted, in favour of the Respondent. The directions of the NCDRC are accordingly modified in the above terms."
46. In view of the law laid down by the Hon'ble Supreme Court in the above said case, in the cases of subsequent allottees the interest on the refundable amount is to be paid from the date when the opposite party acquired knowledge of transfer or acknowledged the transfer/allotment in favour of subsequent allottee. Meaning thereby the interest shall be paid from the date of transfer of plot/LoI etc. in favour of the subsequent allottees/Complainants."
36. In view of said judgment, the interest to the subsequent allottee shall be paid from the date of transfer of plot/LoI in favour of the subsequent allottee.
37. In view of the above discussion as well as the facts and circumstances of the present case, it is apparent that the OP had failed to complete the development works within the agreed period and it amounts to 'deficiency in service' on its part. In the present case also, the Complainant is the subsequent allottee. In the Appeal, the Complainant has prayed for grant of interest at the rate of 9% per annum from the date of deposit of the deposited amount till realization. Therefore, the impugned order is liable to be modified and the Complainant is entitled to interest at the rate of 9% per annum on the amount so deposited by her from the date of transfer of the plot till realization. Some of the judgments relied upon by learned Counsel for First Appeal No.240 of 2023 21 the Appellant/OP are distinguishable and are not applicable to the facts and circumstances of the present case.
38. In some of the cases, the Appeals have been filed by the OP-PUDA only and no Appeals have been filed by the Complainants. In those cases, interest at the rate of 8% or 9% has been awarded. Since the Complainants in those cases have not filed Appeals, so in such circumstance, the interest in those cases shall remain the same as awarded by the District Commission.
39. In some of the cases, the OPs were directed to refund the entire amount so paid the Complainant(s) along with interest @ 8% per annum from the date of filing of the Complaint i.e. 25.09.2017 till its realization. In case the impugned orders in said cases are modified and the interest is awarded from the date of transfer of the plot in favour of the Complainant(s), it will amount to enhancing the compensation in favour of the Complainant(s), which is not possible because the Complainants have not filed any Appeals in those cases. Said Appeals are liable to be dismissed and the impugned orders are to be upheld.
40. In view of the relevant discussion as held above, both the First Appeal No.240 of 2023 filed by the OP and the First Appeal No.802 of 2022 filed by the Complainant are partly allowed. The impugned order dated 03.12.2021 passed by the District Commission is modified to the extent that the First Appeal No.240 of 2023 22 Complainant is entitled to interest at the rate of 9% per annum from the date of transfer of the plot in her favour till its realization. Rest of the impugned order is upheld.
41. In First Appeal No.240 of 2023, the Appellant had deposited a sum of ₹2,16,743/- at the time of filing of the Appeal. Out of said amount, an amount of ₹15,000/- be deposited by the Registry in the Consumer Legal Aid Account of this Commission towards the costs imposed upon the Appellant for condonation of delay vide this order. The remaining amount, along with interest which has accrued on the total amount of ₹2,16,743/-, if any, shall be remitted by the Registry to the District Commission forthwith, who may pass appropriate order in this regard in accordance with law. First Appeal No.241 of 2023 MA No.465 of 2023
42. There is a delay of 437 days in filing of First Appeal No.241 of 2023. MA No.465 of 2023 has been filed for condonation of delay, which is supported by an affidavit.
43. For the reasons recorded in the Application, the Application is allowed and the delay in filing of the Appeal is condoned subject to costs of ₹15,000/- to be deposited in the Consumer Legal Aid Account of this Commission forthwith.
Main Case First Appeal No.240 of 2023 23
44. Similarly, in said Appeal, one Balwant Singh was allotted plot No.90 in the project launched by the OP in PUDA Enclave, Faridkot vide allotment letter dated 09.05.2012 at the rate of ₹5,000/- per sq.yd. He paid an amount of ₹12,58,750/- to the OP up to 23.11.2025. The Complainant had purchased the said plot from the original allottee and thereafter the said plot was transferred in his name vide letter dated 12.02.2015. As per the terms and conditions of the allotment letter, the OP was required to provide all the amenities such as water supply, sewerage connections, roads, street lights etc. within a period of 18 months from the date of allotment but it had failed to complete the development at the site. The other averments of the Complaint were similar to that of First Appeal No.240 of 2023. The prayer was made for issuance of direction to the OP to refund the amount of ₹12,58,750/- along with interest @ 12% per annum from the date of deposit till realization and also to pay an amount of ₹2 lac as damages and ₹50,000/- as litigation expenses, OR, in the alternative to complete the development works and to hand over the actual and physical possession of the plot and to refund the interest charged by the OP along with interest at the rate of 12% per annum till delivery of the possession of the plot.
45. Upon issuance of notice, the OP had filed its written version on the similar lines of its reply as mentioned in First Appeal No.240 of 2023.
First Appeal No.240 of 2023 24
46. The District Commission had allowed the Complaint vide order dated 03.12.2021. The relevant portion of said order as mentioned in Para-11 as reproduced as under:
".....Hence, Complaint in hand is hereby allowed. Opposite Party is directed to refund the amount of Rs.12,58,750/- to Complainant alongwith interest at the rate of 9% per annum from date of deposit of payment till the date of realization of refund of the amount. Opposite Party is further directed to pay Rs.5,000/-to Complainant as compensation for harassment and mental agony suffered by him besides Rs.5,000/- as litigation expenses. Compliance of this order be made within 30 days from the date of receipt of copy of this order. Copy of the order be supplied to parties free of cost. File be consigned to the record room."
47. Being aggrieved by said order, the Appellant/OP has filed First Appeal No.241 of 2023. However, no Appeal has been filed by the Respondent/Complainant.
48. In view of the relevant discussion as mentioned above and the facts and circumstances of the case, this Appeal is partly allowed and the impugned order dated 03.12.2021 passed by the District Commission is modified to the extent that the Complainant is entitled to the refund of the amount so deposited by him along with interest at the rate of 9% per annum as awarded by the District Commission from the date of transfer of the plot in his favour till its realization. Rest of the impugned order is upheld.
49. In First Appeal No.241 of 2023, the Appellant had deposited a sum of ₹11,54,556/- at the time of filing of the Appeal. Out of said amount, an amount of ₹15,000/- be deposited by the Registry First Appeal No.240 of 2023 25 in the Consumer Legal Aid Account of this Commission towards the costs imposed upon the Appellant for condonation of delay. The remaining amount, along with interest which has accrued on the total amount of ₹11,54,556/-, if any, shall be remitted by the Registry to the District Commission forthwith, who may pass appropriate order in this regard in accordance with law.
First Appeal No.1035 of 2022
50. Initially, the Complaint was filed by the Complainants before the District Commission, Ludhiana and thereafter, it was transferred to the District Commission, Moga as per order dated 26.11.2021 passed by this Commission on the administrative side.
51. In the case in hand, one Karan Singh was allotted a plot measuring 200 sq.yds. in the project launched by the OPs at Sugar Mill Site, Jagraon vide Letter of Intent dated 12.03.2013. He had paid an amount of ₹4,25,000/- to the OPs. The Complainants had purchased the said plot from the original allottee and had paid an amount of ₹42,500/- towards transfer fee and ₹2,500/- towards Processing Fee and thereafter, the Letter of Intent was transferred in the name of the Complainants vide letter dated 28.05.2013. The tentative price of the said plot was ₹17.85 lacs and the Allotment Letter was issued in favour of the Complainant on 19.09.2015. The Complainants had paid the further instalments and a total sum of ₹14,35,601/- was paid to the OPs. However, the OPs had failed to First Appeal No.240 of 2023 26 complete the development works at the site as well as to deliver possession of the plot within the stipulated period as per the terms and conditions of the allotment letter. Other averments of the Complaint were similar to that of First Appeal No.240 of 2023. The prayer was made for issuance of direction to the OPs to refund an amount of ₹14,35,601/- along with reasonable interest from the date of deposit till its realization and also to pay compensation of ₹2 lac for causing mental tension and harassment to the Complainants as well as ₹2 lac due to increase in the price of construction and ₹55,000/- towards litigation expenses.
52. Upon issuance of notice, the OPs had filed their written version on the similar lines of the reply as mentioned in First Appeal No.240 of 2023.
53. The District Commission had disposed off the Complaint vide order dated 23.05.2022. The relevant portion of said order as mentioned in Para-10 as reproduced as under:
"10. In view of the aforesaid facts and circumstances of the case, since the Opposite Parties have failed to comply with the directions, as mentioned above, they are directed to refund the entire amount deposited against the plot in question i.e. Rs.14,35,601/- (Rupees fourteen lakh thirty five thousands six hundred and one only) to the Complainant alongwith interest @ 8% per annum from the date of filing the present Complaint i.e. 25.09.2017 till its actual realization. Opposite Parties are also directed to pay the lump sum compensation to the Complainant for causing him mental tension and harassment to the tune of Rs. 10,000/- (Ten thousands only). The compliance of this order be made by Opposite Parties within 45 days from the date of receipt of copy of this order, failing which the Complainant shall be at liberty to get the order enforced in accordance with law. Copies of the order be furnished to the parties free of cost by District Consumer Commission, Ludhiana and thereafter, the file be consigned to record room after compliance."First Appeal No.240 of 2023 27
54. Being aggrieved by the said order, the Appellant/OP has filed First Appeal No.1035 of 2023. However, no Appeal has been filed by the Respondents/Complainants.
55. In this case, the OPs were directed to refund the entire amount so paid by the Complainants along with interest @ 8% per annum from the date of filing of the Complaint i.e. 25.09.2017 till its realization along with compensation. However, the Complainants had not filed any Appeal.
56. In view of the relevant discussion as mentioned above and also the facts and circumstances of the case, this Appeal is dismissed and the impugned order dated 23.05.2022 passed by the District Commission is upheld.
57. In First Appeal No.1035 of 2022, the Appellant had deposited a sum of ₹25,000/- at the time of filing of the Appeal. Another amount of ₹9,91,563/- was also deposited against receipt dated 04.01.2023 in compliance of order dated 06.12.2022 passed by this Commission. Said amount, along with interest which had accrued thereon, if any, shall be remitted by the Registry to the District Commission forthwith, who may pass appropriate order in this regard in accordance with law.
First Appeal No.1074 of 2022
58. Initially, the Complaint was filed by the Complainant before the District Commission, Ludhiana and thereafter, it was First Appeal No.240 of 2023 28 transferred to the District Commission, Moga as per order dated 26.11.2021 passed by this Commission on administrative side.
59. Similarly, in this case, one Harish Kumar was allotted a plot measuring 200 sq.yds. in the project launched by the OPs at Sugar Mill Site, Jagraon vide Letter of Intent dated 10.01.2013. He had paid an amount of ₹4,25,000/- to the OPs. The Complainant had purchased the said plot from the original allottee and had paid an amount of ₹45,000/- towards transfer fee and thereafter, the Letter of Intent was transferred in the name of the Complainant vide letter dated 07.06.2013. The Complainant had paid the amount of further instalments and a total sum of ₹13,75,250/- was paid to the OPs. However, the OPs had failed to complete the development works at the site as well as to deliver possession of the plot within the stipulated period as per the terms and conditions of the allotment letter. The other averments of the Complaint are similar to that of First Appeal No.240 of 2023. The prayer was made for issuance of direction to the OPs to refund the amount of ₹13,75,250/- along with reasonable interest from the date of deposit till its realization and also to pay compensation of ₹2 lac for causing mental tension and harassment to the Complainants as well as ₹2 lac due to increase in the price of construction and ₹55,000/- towards litigation expenses. First Appeal No.240 of 2023 29
60. Upon issuance of notice, the OPs had filed their written version on the similar lines of the reply as mentioned in First Appeal No.240 of 2023.
61. The District Commission had disposed off the Complaint vide order dated 23.05.2022. The relevant portion of said order as mentioned in Para-10 as reproduced as under:
"10. In view of the aforesaid facts and circumstances of the case, since the Opposite Parties have failed to comply with the directions, as mentioned above, they are directed to refund the entire amount deposited against the plot in question i.e. Rs.13,75,250/- (Rupees thirteen lakh seventy five thousands two hundred fifty only) to the Complainant alongwith interest @ 8% per annum from the date of filing the present Complaint i.e. 25.09.2017 till its actual realization. Opposite Parties are also directed to pay the lump sum compensation to the Complainant for causing him mental tension and harassment to the tune of Rs. 10,000/- (Ten thousands only). The compliance of this order be made by Opposite Parties within 45 days from the date of receipt of copy of this order, failing which the Complainant shall be at liberty to get the order enforced in accordance with law. Copies of the order be furnished to the parties free of cost by District Consumer Commission, Ludhiana and thereafter, the file be consigned to record room after compliance."
62. Being aggrieved by the said order, the Appellant/OP has filed First Appeal No.1074 of 2023. However, no Appeal has been filed by the Respondents/Complainants.
63. In this case, the OPs were directed to refund the entire amount so paid the complainant along with interest @ 8% per annum from the date of filing of the Complaint i.e. 25.09.2017 till its realization along with compensation. The Complainant has not filed any Appeal.
64. In view of the relevant discussion as mentioned above and also the facts and circumstances of the case, this Appeal is First Appeal No.240 of 2023 30 dismissed and the impugned order dated 23.05.2022 passed by the District Commission is upheld.
65. In First Appeal No.1074 of 2022, the Appellant had deposited a sum of ₹25,000/- at the time of filing of the Appeal. Another amount of ₹9,48,828/- was deposited vide receipt dated 04.01.2023 in compliance of order dated 14.12.2022 passed by this Commission. Said amounts, along with interest which has accrued thereon, if any, shall be remitted by the Registry to the District Commission forthwith, who may pass appropriate order in this regard in accordance with law.
66. All the Appeals stand disposed off accordingly.
67. Since the main cases have been disposed off, so all the pending Miscellaneous Applications, if any, are accordingly disposed of.
68. The Appeals could not be decided within the statutory period due to heavy pendency of court cases.
(JUSTICE DAYA CHAUDHARY) PRESIDENT (SIMARJOT KAUR) MEMBER July 31, 2024.
(Gurmeet S)